Response Magazine's Ninth Annual State of the Industry Report

Members of the magazine's Editorial Board weigh in on self-regulation, the effects of the Web, and the continuing battle for good media time.

Prospects for 2005 are a tough call - even for the seasoned professionals in direct response television (DRTV). Technological innovations, the rising costs of media buying and stringent Federal Trade Commission (FTC) and Federal Communications Commission (FCC) regulations are all variables that will influence the industry's continued growth and vitality. In 2004, marketers dealt with a flood of short-form advertising introduced by pharmaceutical companies' brand-building campaigns, and this cramp will only tighten with upcoming presidential elections and Olympic programming. Some estimates project that 500,000 spots will be purchased for election campaigns by early November.

Pricey media buying this year meant smarter campaign planning, but it also forced marketers to reexamine their behind-the-scenes strategies from production to outsourced customer service. They also had to answer to a new kind of consumer. Shoppers are making more prudent decisions nowadays. They want superior products and the impeccable service to go along with them.

Two-thousand five will be a year of continued transition that will likely involve more DRTV/Web syncopation and ongoing efforts to dust off negative perceptions of DRTV. Industry leaders are hoping that the Electronic Retailing Association's (ERA) new Self-Regulation Program, in addition to governmental crackdowns, will make it possible.

Response invited members of its Editorial Advisory Board to share their insight and make a few predictions about what DRTV should expect in the coming year. Their answers are a collection of national and international expertise from all avenues of the industry. According to them, this is the current state of the industry.

1. What was the most significant accomplishment in the past year for the DR industry?

Jake Weisbarth, Content=Commerce: Web integration. This has been ongoing for several years now. Its impact is being widely felt especially as media rates rise. Most companies have worked to integrate the Web into most of their campaigns and this marketing channel has firmly rooted and enhanced revenue in our industry.

Richard Stacey, Northern Response Intl. Ltd.: One of the most significant accomplishments in the past year for the DR industry was the ERA's formal establishment of a self-regulating mechanism to report and review DRTV programming that may not meet ERA marketing guidelines or other laws and regulations.

Tim Hawthorne, hawthorne direct inc.: The entry of major consumer packaged goods manufacturers into the DRTV industry. Procter & Gamble tested nearly a dozen short-form campaigns for such diverse goods as Swiffer Wet Jet and Duster, Febreze, Cascade, Comet, Dawn, Crest and Mr. Clean while Clorox entered the field with campaigns for ToiletWand and Glad ForceFlex. Never before has there been as much activity among brand advertisers testing DRTV with excellent results.

“The consumer is getting too much information from too many marketing channels. It’s tougher to communicate to the consumer. They are very distracted and their attention span is getting shorter. ”— Jake Weisbarth, Content=Commerce

Hal Altman, Motivational Fulfillment & Packaging Services: The year of 2004 has been an easily forgettable year for DR in most cases. As far as the most significant product, it has to be the CortiSlim weight-loss product. This product has not only dominated TV and radio, but by Christmas will have retail presence in every major drug and retail store in the country.

2. How are the FTC and FCC crackdowns on negligent advertisers and call centers affecting the business?

David Savage, ATC Agency Services: The FTC enforcement actions will, in general, have a positive effect on the business. I think most marketers are taking serious lessons from these enforcement actions. The more reliable the claims being made are for all products advertised through DRTV, the more trust consumers will have in our industry and the better the sales environment will be for all of us.

“One of the most significant accomplishments in the past year for the DR industry was the ERA’s formal establishment of a self-regulating mechanism.”— Richard Stacey, Northern Response Intl. Ltd.